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  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    MLS Today

    The reports of my death are greatly exaggerated


    MLS Tomorrow

    MLS 5.0

    The MLS of the Future

    What will be required to build on the current solid foundation of todays MLS?

    This paper attempts to answer this question and create a basis for an industry discussion.

    Open and frank discussion is essential to creating the tools and organizations that will

    position REALTORS to provide services to meet the expectations of future buyers and

    sellers. This Paper is a vision and not a roadmap. MLS in the broad, generic sense, needs to

    be redefined in the age of information proliferation and online participatory environments.

    MLS is more than an offer of compensation and cooperation, but how much more? That

    decision is up to you.

    Saul Klein

    CEO InternetCrusade

    CEO Point2 Technologies

    August 7, 2008

    Page 1

    [email protected]

    Copyright 2008. Saul D. Klein. All Rights Reserved.

  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    Table of Contents



    Take Away Terms...4Executive Summary5-6



    Evolution of MLS What is MLS 5.0? .10-11

    Description of MLS 5.0 (MLS 5.0 is).....12

    MLS 5.0 is a Property Wiki - (Parcel based not listing based)...13-14

    Who Will MLS 5.0 Serve?...............................................................................14

    Understanding and Adapting to Generational Differences.15-16

    Being at the Center of the Conversation..16

    Enabling Innovation.16-17

    Single Point of Entry and Content Distribution (Syndication)18-19

    Referral Network..19

    Agent Rating System....20

    Neighborhood Data..20-21

    Sold Data..21

    Strong Authentication (Two Factor Authentication)... 21

    SSO - Single Sign-On...22

    Online Communities.22

    Local, Regional, State, or National MLS..22-23


    What is the Alternative? ...24

    Famous Last Words...24-25

    Transaction of the Future25


    Your Plan of Action...28

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 2
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    In 1897, Mark Twain was traveling in Europe and heard that the New York Journal had

    printed his obituary. He responded to a friend in a handwritten note: "The report of my

    death was an exaggeration," which over the years has morphed into The reports of mydeath are greatly exaggerated.

    A popular recurring MLS theme and discussion point over the last few years has centered

    on the idea that MLS is dead, or irrelevant, or both. Nothing could be further from the


    This Paper is a summary of the potential that the MLS can bring to the real estate

    industry and to consumers and, at the same time, it can be viewed as a subtle warning ifbrokers and industry leaders fail to grasp the strengths MLS currently possesses and

    employ them in a fast changing world, when consumer alternatives are popping up at

    every turn. It is based upon 33 years of MLS experience in many areas and at many


    Saul Klein has been a member of several MLSs in San Diego, California since 1975 and

    has been a licensed California broker since 1977. He served as the Vice President of the

    San Diego Association of REALTORS when the MLS in San Diego County was

    regionalized from 11 associations and 4 MLSs to 5 associations and one MLS, creating

    one of the first large regional MLSs in the country in 1991. In 1993 he was the president

    of the San Diego Association and served as a Shareholder representative to the San Diego

    regional MLS (Sandicor) that same year. He has in depth experience dealing with MLS

    antitrust issues, locally and at the national level, consulting privately with many industry

    leaders as the IDX/VOW/ILD policies evolved and were debated and as NAR prepared

    for litigation with the US Department of Justice. Saul has served on the California

    Association of REALTORS MLS Committee continuously since 2003, and has facilitated

    close to 100 Strategic Planning sessions for both associations and MLSs nationwide and

    has provided consulting services to MLS vendors. He is widely recognized as a

    consultant to the industry and the first real estate industry Internet evangelist, preparing

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 3
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    the way for the National Association of REALTORS (NAR) initial thrust in

    technology, and he was instrumental in the socialization process which resulted in listing

    information flowing to the Internet in the Mid 1990s on He continues to

    be a student of MLS and is sought after as a speaker, consultant, and facilitator, helping

    to bring clarity to the industry asthe role of associations, MLSs, and real estate licensees

    continues to evolve in a Web 2.0 world.

    Saul currently serves as CEO of two technology companies, Point2 Technologies and

    Real Estate Electronic Publishing Company (DBA InternetCrusade). For a complete

    Resume, go to:

    To Access this report on the web go to:

    Take Away TermsAuthoritative and trusted source


    MLS 5.0

    Online communities

    Parcel based

    Property Wiki

    Single Point of Entry

    Single Sign-On

    Social Networking

    Strong (two party) Authentication



    Web 2.0

    Note: Also included in the document are links to definitions and ancillary

    information that may help for a better understanding of the theme of this Paper.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 4
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    Executive Summary

    Time is of the essence.

    The real estate industry has the opportunity to take back its future. In order to do so, it must

    begin the process of first socializing to associations, MLSs, brokers, consumers (all stakeholders)

    and then implementing MLS 5.0, theMLS of the Future.This will not take place overnight, but is

    a living process that must be engaged.

    Many in the real estate industry have heard ofWeb 2.0, yet with all the press it has received, few

    understand or can define it. Understanding Web 2.0 and what it entails is essential to the

    understanding ofMLS 5.0, as MLS 5.0 incorporates Web 2.0 concepts, principles, core

    characteristics, technology building blocks, applications, and uses.

    To understand MLS 5.0, consider the evolution of the MLS, which over the past 30 years or so

    looked something like this:

    First Generation - Three ring binders with weekly updates and daily errata

    Second Generation - The bound MLS book

    Third Generation - Computer access to the data through "dumb terminals"

    Fourth Generation - Web based MLS (no more banks of phone lines and busy


    Fifth Generation - MLS 5.0

    A key element of MLS 5.0 is that it is parcel based and not listing based. It includes all parcels of

    real property in the Town/City/Region/State/US, not just the inventory of properties available for

    sale at any given point in time. It leverages property information from various sources

    accumulated over time to bring consumers and real estate professionals together on the Web to

    participate in an ongoing conversation with real estate at its center.

    MLS 5.0 has a public facing side for consumers to interact with real estate professionals and a

    private side (business network) for the use of real estate professionals.

    Page 5

    An army of real estate professionals have the local knowledge to create a force that can compete

    with those companies currently working to harness the power of property information as the

    center of their online business model. Consumers frequent different destinations on the Internet

    for different reasons. MLS 5.0 will be the authoritative and trusted source of all real property

    information, not just property for sale. MLS 5.0 is the resource that will give real estate

    Copyright 2008. Saul D. Klein. All Rights Reserved.
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    professionals the opportunity to transcend the present and continue their success into the future as

    relevant participants in the lives of their customers, serving as trusted real property advisors.

    Along the way it will be required to leave some ideas and habits behind. Knowing that old habits

    die hard, it will require nothing less than a Crusade to socialize and then transition associations,

    MLSs, brokers, and real estate professionals to this new tool. MLS 5.0 recognizes that we exist in

    the age of information.

    MLS 5.0 is built in the spirit ofWeb 2.0, open, collaborative, self-organizing and self-policed. It

    is no longer sufficient to advocate that real estate professionals be at the "Center of the

    transaction," as was promoted in the 1990s. To be at the center of the transaction, the real estate

    professional must now be at the "Center of the conversation" about real property, and this is

    essential to the mission ofMLS 5.0.

    In addition, through the use ofOpen APIs that provide access to listing data, applications can be

    built cost-effectively, leading to a richer ecosystem of features and software that will benefit real

    estate professionals and ultimately consumers, encouraging user experience design.

    MLS 5.0 provides asingle point of entry for listing data. Based upon the election of brokers or

    their agents, it will distribute that information to web portals, newspapers, radio and television,

    and applications, and then track and return information about prospects to the broker. Why pay

    for Internet leads generated from your listings? With MLS 5.0, you benefit from inquiries about

    your listings.

    MLS 5.0:

    Is a property wiki

    Is a social networking site.

    Incorporates Single Sign-On in a range of ways

    Will change many aspects of the real estate business, reflecting and satisfying the needs

    of real estate professionals and real estate consumers as technology evolves and new

    generations come of age.

    It is not the intent of this paper, nor is it possible, to answer every question about MLS 5.0, rather

    it is to begin the discussion and move to outcomes that will be beneficial to the

    stakeholdersconsumers, agents, brokers, vendors, associations, MLSs, staffs and anyone

    interested in MLS.

    Let the discussions begin. Time is of the essence.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 6
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    ConceptThe real estate industry has the opportunity to "take back its future." For a number of

    reasons, it has appeared over the last few years that forces, out of our control, were at

    work to reshape the real estate industry -- from technology, to the Internet, to the United

    States Department of Justice, to new business models that are the darlings of Wall Street,

    to the press, to the divergence of the different generations, and to economic conditions. It

    is now time to fight back, and in doing so, all concerned will be winners, REALTORS

    and consumers alike.

    It is upon this theme that the concept ofMLS 5.0 is introduced, as the MLS of the Future.

    It is time to look at what MLS seemingly has always done, and bring it into the new

    millennium. This will require bold initiatives. To get the most out of this Paper, you may

    need to suspend your skepticism and step into the future. Ask yourself: What is the

    value a real estate professional brings to consumers when information about everything,

    including real estate, is so abundant on the Web? MLS 5.0 should provide the tools to

    enable the real estate professional to deliver value, part of which will be to put the

    information available into context for the consumer.

    Page 7

    Today, MLS is not the only way to gain exposure for listings. Yahoo, Google, Zillow,Trulia, Craigslist, VAST, Point2Homes, and many more have the

    potential to expose listings to more potential buyers than ever before, and for a fraction of

    the cost of traditional advertising. If you were a consumer selling your home, wouldnt

    you want it marketed everywhere? In the age of information, consumers and

    REALTORS are becoming more comfortable using these new tools and new databases,

    and will become even more comfortable as the concepts of Web 2.0 become better

    appreciated and understood. MLS must reflect the new realities. Many REALTORS are

    not acquainted or familiar with some of these realities. It will take more than vision to

    bring the ideas and concepts of MLS 5.0 into reality. It will take courage and leadership,

    as old paradigms, territorial rights, politics, potential job loss by MLS executives and

    staff, and fear will undoubtedly create obstacles to successfully altering the mission of

    MLS. And that is what we are talking about, altering the mission, and with a new vision

    Copyright 2008. Saul D. Klein. All Rights Reserved.
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    for MLS. Objections, real and imaginary, will be heard in abundance. Be prepared to

    field them.

    Question (which has been asked many times over the past 10 years, but never really


    If we were to build an MLS today, with the technology available and for the different

    generations of REALTORS, home buyers, and home sellers, what would we include and

    how would we go about the task?


    Parcel Based Best described as a Property Wiki

    Built upon Web 2.0 Concepts Using technologies to engage:

    o The Consumer



    o Vendors

    o Developers

    Public Side and a Private Side

    Online communities for REALTORS (public and private)

    Online communities for consumers (public and private)

    Multi lingual

    Employ Agile Software Development Processes; aligning business goals with

    technology capabilities

    Built with an Eye on Generational differences and expectations

    Agent rating system

    Referral system at no charge to agents

    Extensive agent profiles

    Builds and improves neighborhood information through user input

    Works to create Federations and implements SSO (Single Sign-On) Continues to have a governance structure and service centers for real estate


    Enables Innovation

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 8
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    Is built with a Vision (If you dont know where you are going, any road will take

    you there, to paraphrase Cheshire Cat in Alice in Wonderland)

    Is built with a Specific Mission

    Vision Statement ofMLS 5.0:

    MLS 5.0 is the authoritative and trusted source for all things related to real estate,

    for REALTORS and Consumers.

    Mission Statement ofMLS 5.0:

    Keep the REALTOR in the Center of the real estate Conversation, realizing that

    that conversation extends from far in advance of a purchase and continues after a

    purchase of real property. Real estate is a lifetime conversation.

    MLS 5.0 will use the resources of: The aggregated listing information, which are assets owned by the brokers that

    created and financed the businesses to contract those listings, and

    Information associated with a property even when that property is not for sale.

    And allow it to be augmented by images, sound, video, and text and include it in a

    database of all properties, not just those for sale.

    Sold data accumulated by MLS

    Public data

    Consumer-generated content from online communities, groups, blogs, and other

    Web 2.0 technologies and applications

    MLS 5.0 will leverage that information to bring consumers and real estate professionals

    together on the Web to participate in ongoing conversations with real estate at the center.

    Much of what affects the lives of individuals centers on their home, their neighborhood,

    and their community.

    MLS 5.0 will have a public facing side for consumers and for consumer to REALTOR

    interaction, and a private side for the use of real estate professionals, a business to

    business network.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 9

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    This is a far cry from where MLS is today, and this is the challenge. If we do not take up

    this challenge as an industry, to create the authoritative and trusted source of real

    property information on the Web, it will happen anyway -- in fact, the battle has already

    been engaged.


    The reports of my death are greatly exaggerated - Mark Twain

    While currently at risk of becoming irrelevant in the next generation, MLS has within its power,

    the assets needed to continue to lead the real estate industry and become an even stronger, more

    essential player. It is important to note that no other entity or organization has what we in

    organized real estate have (and they all want it), and that is the authoritative source of all

    properties for sale and sold, and an army of REALTORS with the grassroots power and local

    knowledge to create a force that can compete with all comers. Through the creation ofMLS 5.0,

    MLS will continue to be the most important tool of the real estate industry. MLS is the tool that

    will give REALTORS the opportunity to transcend the present and continue their success into

    the future...but they must be willing to leave some ideas and habits behind in the process.

    If we decided to build the structures and organizations of todays MLS from scratch, it would

    not look like what we have currently. Building an MLS is not the challenge; we have been doing

    it for years. Building an MLS and property database to serve the needs of REALTORS andconsumers as technology changes methods and habits of accessing information, building an MLS

    that reinforces a compelling argument for the use by consumers of a real estate professional in the

    transaction with an abundance of information about real estate found everywhere on the web in

    bits and pieces, and overcoming the political and parochial interests, that is the challenge.

    Not to be overlooked is the fact that MLS is an offer of compensation. Until buyers are ready to

    sign commitments to pay brokers and agents for their services whether the buyer buys or doesnt

    buy, this offer of compensation is an important piece of the MLS value proposition.

    Evolution of MLS What is MLS 5.0?

    MLS has been transforming since its creation. For the purpose of this paper, the author, based on

    his own experience, can trace four distinct changes in the method of access and distribution of

    data. The change from the way it is done today to the way of the future requires acknowledging

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 10

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    that major changes have successfully taken place in the past and, it should be added, over the

    objections of many well-intentioned individuals and organizations.

    First Generation Cards and then Listing sheets and ringed binders with weekly updates and

    errata, which were used to update the inventory manually, everyday or every other day.

    Second Generation - The bound MLS book. This book was printed every two weeks. The

    San Diego Association MLS printed a book every week. One week the MLS would print

    a book with Single Family inventory, the next week it printed a book with Condos

    (common interest subdivisions) and two to four units. Each week there would be a hot

    sheet for the previous weeks book. Even in a good real estate market, no one dreamed

    of anything close to a system where the inventory was updated daily. The idea of Real

    Time access (like one can find on certain web sites like Craigslist), would have beendiscarded as eccentric.

    Third Generation - Computer access to MLS data through "dumb terminals" over

    telephone linesno monitors, no video display. In San Diego, two types of terminals

    were available. One was a large, stand up model; the other was portable, which was the

    size of a medium suitcase. Each had a coupler referred to as Mickey Mouse Ears. To

    access the computer database, one would dial a number, wait for an answer and for the

    electronic handshake, and then jam the telephone receiver into the Mickey Mouse

    Ears. Often, if it was a busy time of day, all of the access lines to the computer databasewere in use and a busy signal heard.

    Fourth Generation Web-based MLS (no more banks of phone lines and busy signals),

    access with a browser, only one type, Internet Explorer, and through a dial up at 14,400.

    Fifth Generation - MLS 5.0 Let your imagination run a little here

    Built in the spirit ofWeb 2.0, MLS 5.0 is open and collaborative, incorporating all the

    current and future tools of Web 2.0 (and Web 3.0), from the LAMP stack, to the

    applications such as blogs, RSS, Widgets, APIs, Wikis, taxonomies, social networks,mash-ups and more.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 11
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    MLS 5.0 is:

    The authoritative and trusted source for all things related to real estate. This begins

    with the accurate inventory of currently available property for sale, and the best

    Sold data available anywhere. This information is like fly paper when it comes to

    attracting consumers to a web site.

    A Property Wiki all information about properties (by parcel or address) that can be

    ascertained and that can be augmented. It becomes a comprehensive historical record.

    A Social Networking Site REALTORS meeting REALTORS/REALTORS

    meeting consumers/consumers meeting consumers.

    Built understanding generational differences, serving the REALTOR of today and

    the REALTOR of the future, to better serve the consumer of today, and the

    consumer of the future.

    Private and Public facing components

    The REALTORS home online

    A closed business network for subscribers and participants

    Online neighborhood information, contributed by neighbors

    Open and closed communities and groups and forums

    Appropriately Secure

    Page 12

    The "Single Point of Entry" for data distribution (Syndication of Listing Data), as a

    choice for brokers and agents -Distribution Trumps Destination

    Copyright 2008. Saul D. Klein. All Rights Reserved.

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    Multi-lingual where and when appropriate

    A Public display of available inventory (public facing MLS)

    A Public display of appropriate sold data

    A place for REALTORS to prospect for buyers and sellers

    Designed with Single Sign-On (SSO) to other web destinations in mind

    Open yet secure, information available without artificial geographic boundaries;

    ensuring that the data is accessible to the widest audience possible while obeying

    regulatory restrictions.

    The center for Transaction Management Applications

    Open to and encouraging of innovation, allowing for various front end software to be

    created and used to access the data. Members of the MLS could choose a Rapattoni

    front end one day and select a FNIS front end the next. A user might find that one

    front end is good for some things and one is good for others, and use the appropriate

    tool to get the job done. Openness should allow for more applications and solutions

    and lower prices for REALTORS

    MLS 5.0 is a Property Wiki - (Parcel based not listing based)

    A wiki is a collection of web pages, where the content is written by contributors (Wiki in

    plain English). Wiki software can have many uses and applications, the most well known

    being Wikipedia, which is an encyclopedia written by volunteer writers and editors.

    Companies today often use wiki software to create searchable, retrievable information

    about the company. A wiki begins with something referred to as a Stub, which can be a

    word or a phrase and then contributors write about the stub. Because of a concept known

    as the wisdom of crowds the information about that stub becomes more and more

    comprehensive and accurate. Wikis are fundamental to Web 2.0. Do not be led to believe

    that wikis are not accurate. To test, go to and search for a word or phrasethat you are familiar with and check the accuracy.

    The word wiki is the Hawaiian word for fast or quick. If you have every flown into the

    Honolulu International Airport, you have probably taken a ride on the Wiki Wiki Shuttle.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 13
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    A property wiki then is a wiki where the stubs are property addresses or parcel numbers,

    to which information from contributors and editors can be added to create a

    comprehensive record.

    Imagine a blank web site for every property address in the US. To that blank Web site

    imagine adding anything publicly known. Now imagine inviting the property owner and

    REALTORS to add what they know about the property. While there are some concerns

    about accuracy, Web 2.0 concepts, self-policing, flagging, and social capital will in time

    minimize the inaccuracies.

    This is a key to understanding MLS 5.0. A listing is merely a moment in time of the life

    of a property. MLS data is a subset of a larger body of data relative to a parcel of real

    property. Of value to REALTORS and consumers is information about a parcel before

    the property is listed for sale. Property history, in one convenient place, is a valuable

    asset that grows in value as more information is accumulated over time. Pictures, video,

    audio, text and other formats of information relevant to a property and conveniently

    aggregated have value. A prospective buyer might be interested in pictures of a home

    before and after a remodel.

    Who Will MLS 5.0 Serve?

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 14

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    MLS 5.0 will serve the customer of today and be ready for the customer of tomorrow.

    That customer is the REALTOR and their customer, the buyers and sellers of real

    estate. According to NAR, Gen X and Gen Y made up 78.8% of all first time home

    purchases in 2007. This is a significant milestone. While there is a variety of information

    and definition about the different generations, one thing for certain is that there are truly

    generational differences based on the times in which people live, the seminal events in

    their lives, and the world conditions they experience during their lifetime. MLS has

    always been a Broker to Broker (Business to Business) Network. It was not created as a

    central platform to facilitate marketing efforts. Marketing today needs to take into

    consideration generational destinations, modes of communication, and targeted marketing


    At who is this message targeted?

    Understanding and Adapting to Generational Differences

    From Wikipedia:

    Generation X Baby busters - 48 Million Original Latch Key Kids Independent Skeptics Techno literate MTV generation

    Inception of the Internet

    Generation Y - Echo Boom - 80 Million Generation Me Confident Collaborative Bathed in Bits

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 15
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    In their book, Connecting to the Net Generation, Reynol Junco and JeannaMastrodicasa found that in a survey of 7,705 college students in the US:

    97% own a computer 94% own a cell phone 76% use Instant Messaging and social networking sites.

    15% of IM users are logged on 24 hours a day/7 days a week 34% use websites as their primary source of news 28% author a blog and 44% read blogs 97% have downloaded music and other media using peer-to-peer file sharing 49% regularly download music and other media using peer-to-peer file sharing 75% of college students have a Facebookaccount 60% own some type of portable music and/or video device such as an iPod.

    They represent Tomorrows REALTOR and Tomorrows Home Owner. MLS 5.0 is

    built to fulfill the expectations of the REALTOR and consumer of today as well as the

    REALTOR and consumer of tomorrow.

    Being at the Center of the Conversation

    It is no longer sufficient to be at the "Center of the transaction." If a REALTOR waits

    until the transaction, it is too late. To be at the center of the transaction, the REALTOR

    must be at the "Center of the conversation" about real property and participate with

    consumers far in advance of the actual listing or sale. This of course has always been the

    case, and is now, more and more, taking place through visibility and participation on the

    Internet, through social networking and social influence marketing. MLS 5.0 on its

    public facing side will give consumers and REALTORS the ability to engage and

    discuss, bringing them together to fulfill the long stated promise of listings on the

    Internet, to bring the REALTOR and the Consumer together. Generational aspects of

    communication and information access beyond current inventories of properties for sale

    are important considerations as the sale period of a property is merely a snapshot in the

    life of a property and just a part of a continuous historical record, that will now be

    available, easy to find in a parcel based MLS, through parcel numbers, addresses, ormaybe even distinct URLs. Web 2.0 concepts and philosophies, sharing and

    collaborating, must be built into the MLS structure and mindset, and released for use as

    the political and territorial constraints allow, and as consumers demand.

    Enabling Innovation

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 16
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    MLS 5.0 envisions future vendors developing valuable real estate applications without

    being required to source the data and develop complex aggregation and data

    interpretation algorithms. Through the use ofOpen APIs that provide access to listing

    data, support existing authentication, and facilitate authorization, applications that

    leverage existing data can be built very cost-effectively leading to a richer ecosystem of

    features that will benefit real estate professionals.

    Example (provided by Zach Scott, CTO Point2 Technologies):

    Creating an application for the iPhone and iPod Touch

    All PC-based platforms will support any browser resolution and will be designed to behighly usable at any resolution above 1024x768. Point2 web logs indicate that fewer than

    10% of users/visitors have resolutions below 1024x768. See for more detailed web

    statistics and trends.

    Specific add-on modules will only be used to enhance the product and will not be

    required. Add-on modules such as Flash, ActiveX, or Java could be used to enhance the

    end-user experience for image uploading and searching, for example.

    There are no specific client-side requirements beyond having a supported web-browser,

    an internet connection and any CPU, memory or hard drive requirements recommended

    by the browsers vendor.

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    Ultimately to realize the MLS 5.0 vision, we will provide support for our Open APIs to

    enable other vendors to offer applications that leverage the listing information. Although

    the APIs are open, MLS 5.0 will remain in control of authorization and policy

    enforcement to protect access to sensitive features and data.

    The APIs will be designed to fit the needs ofMLS 5.0 and will likely consist of

    numerous REST-based and/or SOAP-based interfacesprotected by SSL and other

    standards-based authentication and authorization mechanisms. In addition to this, client

    Copyright 2008. Saul D. Klein. All Rights Reserved.
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    SDKs may be provided in multiple popular languages, such as PHP, Python, Java, .NET,

    and Ruby.

    It is envisioned that numerous MLS vendors will adapt their products to work directly

    with MLS 5.0 via these open APIs in order to provide REALTORS with a full featured

    and familiar front-end. Imaginebeing able to choose from a multitude of CMAs, or create

    your own application specific to your business. All the data can be stored in one database,

    and based on permissions, accessed and solutions and applications developed. In

    summary, the future will be a more open environment where brokers and agents can

    select their Software of Choice from numerous providers.

    Single Point of Entry and Content Distribution (Syndication) -

    "Distribution Trumps Destination"

    No one goes to just one web site; most people go to many and everyone has their

    favorite. It is in the best interest of the homeowner to have their listing appear on the

    Internet on multiple web sites, from Google, to Yahoo, to Trulia, to Craigslist, to and more. It is a lot of work for agents to enter the data multiple times.

    This process should be no more difficult than entering the data once and having it

    distributed to the media outlets of your choice, as determined by the brokers. That is why

    the MLS of the future will include a syndication engine with comprehensive reporting

    features to enhance web advertising initiatives by brokers and agents.

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    The traditional MLS was not created to market to the world outside of its subscribers and

    participants. The MLS of the future will bring a marketing service and benefit to the

    industry by being the single point of entry for listing data and then, based upon the

    election of the broker, distribute that information to web portals, newspapers, even radio

    and television, handheld devices and applications. The MLS will go from being a tool forthe sharing of inventory to being THE primary marketing control point for brokers and

    agents, and providing marketing analytics back to listing agents that will help with

    advertising decisions as more advertising dollars continue to be spent online in the future.

    The below is an old graphic but the evidence is clear, an inordinate amount of media

    spend is still taking place offline. Online advertising can be targeted and more effective

    Copyright 2008. Saul D. Klein. All Rights Reserved.
  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    than old media. As brokers begin to spend more money online, how will they decide

    where to spend their dollars for greatest effect? Tracking and analytical tools coupled

    with predictive marketing tools.

    Where people spend their time

    Forrester Research, US Online Marketing Forecast, May 2005









    % media consumption

    % media spend

    Advertising clout and reduction in advertising costs may be realized through buying

    power and packaging of purchases.

    Lead Generation With advanced Listing syndication software, all leads can and should

    be directed to the listing agent, at no charge. Listings are marketing assets and the leads

    created from the work expended to acquire the listing should go directly to the listing


    Proliferation of Listing Content on the Internet Can listing content be


    The short answer is no. If you are going to put it on the Internet, one way or another, with

    or without the permission of the listing broker, the content will find its way to other

    destinations. Because these destinations have no rules and do not police the content, there

    may be duplication, inaccurate and untimely (property sold a year ago) data. How does

    this happen? Unauthorized scrapping is an Internet fact of life.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 19

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    Since the MLS data is policed, and since listing status is an essential component, and

    since the best entity to provide updated status is the MLS, perhaps MLSs can certify

    status, within a certain period of time. MLS Certified for Sale would be preferred web

    site content for destination sites and for consumers. This concept increases the awareness

    with consumers that they want to go to sites where the property status is MLS Certified

    for Sale.

    Referral network

    A referral network where REALTORS gain exposure and "social capital" based on

    their contribution to and participation in various online communities will be part of MLS

    5.0. No third party referral fee - this is a benefit of participating. Gen X and Gen Y have

    been raised participating online, as evidenced by the explosion of Facebook and

    MySpace. A connection between the MLS and these social networking sites will be a

    feature of the MLS of the future.

    Agent Rating System

    Should this be provided through the MLS or through a third party?

    Some of the information that would be useful in the creation of an agent rating system is

    readily available through the MLS (and the association). Information such as:

    How long agent has been a member of the MLS

    How many transactions completed since joining

    Buyer sides

    Seller sides

    Volume based on sales price

    Average sale price

    Median sales price

    Consumer complaints

    Ethics complaints

    This is a political hot potato. Even if the MLS does not provide a system, it could

    facilitate a third party in the delivery of this service to the public.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 20

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    Many agents and brokers hate this idea, but consider, if you could find out before you

    went to a doctor or a lawyer, where they went to college, where they went to law school,

    where they graduated in their class, how long they have been practicing, if they have any

    complaints against themwould you, as a consumer, find this information valuable?

    If you answered yes, why would it not hold true for the real estate industry?

    Neighborhood data

    Buyers typically choose a neighborhood first, then a home. Rarely do they define the

    neighborhood they are interested in by its zip code (which is how many MLS searches

    are done), and good geographical definitions of neighborhoods are not readily accessible

    and often have what can be referred to as fuzzy boundaries. By employing the

    wisdom of the crowds and online communities, neighborhoods will be better defined to

    the benefit of consumers and REALTORS.

    No one can contribute and help build neighborhood data like REALTORS. The MLS of

    the future will have the most comprehensive and accurate neighborhood information

    available on the Internet. A Facebook application, currently deployed by Point2, will

    assist in this effort.

    Sold Data

    Page 21

    There are political hurdles to overcome, but one of the biggest lures of eyeballs to web

    sites is the promise of sold data. Consumers want the information and have proven that

    they will settle for anything, even inaccurate data. The owners of the most accurate

    historical sold data are the MLSs. There is no aggregated sold data in existence that is as

    good as the sold data contained within our MLSs. Making certain aspects of that data

    available to consumers, with the statement to always consult a REALTOR when

    attempting to determine value, would be valuable in the battle for the consumer's

    attention on the Web, and valuable to REALTORS as well. It is interesting to note that

    sold data is available on the web, yet one of the places you will not find it is on a

    REALTORS web site (with some exceptions). All brokers and agents want more traffic

    to their sites, and they do not want to buy leadsand they have the asset that will help

    Copyright 2008. Saul D. Klein. All Rights Reserved.

  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    them rule the online world of real estate, and they dont use that asset for fear of losing


    Strong Authentication (Two Factor Authentication)

    Various processes and methods of authentication may be provided as determined by the

    local/regional/state MLS when appropriate and timely. While it is generally felt that more

    security will prevent or at least minimize revenue erosion, it could also serve to position

    the MLS as the location for the initial sign in of participants and subscribers. As MLSs

    create trusted relationships or federations with other organizations, the strongest required

    authentication partner would likely be the controlling federation and identity partner.

    SSO - Single Sign-On

    Convenience and the ability to sign into other secure web locations after first signing into

    the MLS with the ease of a click.

    From MLS to other Local MLS

    From MLSto Local Association

    From MLS to State Association

    From MLS to National Association (

    From MLS to transaction related sites (Winforms/Relay)

    From MLS to third-party web marketing platforms and agent and broker web sites

    From MLS to third-party CRM (customer relationship management) solutions

    From MLS to third-party social networking sites (such as currently being done

    from Rapattoni MLSs to RealTown)

    From MLS to non-real estate related sites: Facebook, MySpace, LinkedIn, gmail,



    Online Communities

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 22
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    Consumers will assemble around a website with accurate sold data and property listing

    data. Social networking tools such as blogs, groups, bulletin boards, and other community

    tools, should be readily available as this is where the online conversation will take

    place. Communities can be open and they can be private, depending on the desire of the

    community organizers. Virtual prospecting may replace face to face prospecting in

    the next generation and beyond and MLS 5.0 on its public facing side will fulfill the

    vision of bringing the consumer and the REALTOR together on the Internet.

    Local, Regional, State, or National MLS

    Real estate is local, but technology today will allow for great economies of scale, lower

    prices for a better MLS tool, user-defined experience and more. In the past, each MLS or

    locale, had their own idiosyncrasies, definitions, terms, all essential to that particular

    local MLS. Today, with so much information available beyond the MLS, are all of those

    different fields still necessary, in light of the benefit that can be derived from creating

    standardsnot technology standards, but standard terms?

    Is there a technology solution that would allow for the mapping of data so that every local

    MLS can retain all of their information fields? There is, a data dictionary of sorts, similar

    in concept to what was referred to as DXM (Data Exchange Method) during the

    REALTORS Information Network Project (RIN) back in the mid 1990s, but it is not a

    necessarily easy task and this solution would likely take longer.

    There is the fear for some that someone with access to listing information in their area

    will invade their territory and carpetbag some business. In light of this fear, some want to

    attempt to keep the listing information proprietary to their respective MLS participants

    and subscribers. The next generation of home buyers, sellers and REALTORS wont

    stand for it, they will insist on more transparency and freer flow of the listing and

    marketing information.

    Page 23

    The real benefit in boundary-less access to information is in the ability to provide

    information to ones relocating client, not the ability to sell a home down in San Diego to

    a buyer from Los Angeles. A Los Angeles broker would be able to provide information to

    their customer and refer them, better armed with knowledge about the San Diego market,

    to a San Diego broker. Great advances are being made to regionalize or share MLS data

    Copyright 2008. Saul D. Klein. All Rights Reserved.
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    in mega markets in California and also in other areas of the country. These efforts are

    steps in the right direction.


    When do we start? Some MLSs already have begun, so the answer is yesterday. The

    successful creation ofMLS 5.0 will require vision, leadership, and courage. The

    technology is not the challenge -- people, organizations, their habits and models of the

    world are the challenge. The words of Peter Ducker, father of modern management, have

    never been more applicable: Every organization has to be ready to abandon everything

    it does, to reinvent itself.

    There will be controversy and debate between knowledgeable and well-intentioned

    people. Association and MLS leaders, staff and volunteers, brokers and agents must

    collaborate to create the MLS of the future; otherwise their MLS of the present will

    become a relic of a bygone era. Our industry is going through nothing less than a

    "Paradigm Shift" driven by technology and generational forces. As stated by Joel Barker,

    author of Future Edge, "when a paradigm shifts, everything goes back to zero" . MLSs

    and Associations, large and small, rich and poor, must assist brokers in creating

    compelling arguments for membership and compelling arguments for consumers to usethe services of real estate professionals. It is said of Gen X-ers that being of the latch-

    key kid generation; they have always done everything for themselves, and feel that they

    can continue to do things by themselves. Give them some Starbucks and access to Google

    and they can fly the space shuttle. Their attitude might be Why would I need help

    finding and buying a house?

    Page 24

    MLS and the industry today can become the creators of the future instead of the victims

    of circumstance. Creating a future by design instead of a future by default requires the

    ability to deal with massive and increasing amounts of information in a rapidly-changing

    and participatory environment. The answer is not just an MLS, but the MLS of the future,

    MLS 5.0, which incorporates the consumer, and makes the REALTOR a participant in

    the conversation, not just a cog in the transaction.

    Copyright 2008. Saul D. Klein. All Rights Reserved.

  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    What is the alternative?

    If we dont do it, the list of alternatives is growing: Craigslist, Google, and others, some

    not yet created, all in the spirit and built with the concepts, philosophies, and buildingblocks of Web 2.0 and putting property information in context for the consumer. For real

    estate professionals, now is the time to create your compelling argument for what you do

    and what you charge. The same holds true for MLS.

    Famous Last Words

    We can never be replaced. This is a people business and there is always going to be a

    need for a real estate professional in the transaction.

    Today, there are artificial intelligence software packages that know more about the

    transaction process than many agents. Inventories are easily accessible online. Homes are

    easily and inexpensively advertised online by anyone with very little technology

    expertise required. Complacency about ones value in the home buying and selling

    process could prove disastrous.

    During the 1970s and early 1980s, technological upheavals (appearance of the quartz

    technology) and the difficult economic situation resulted in a reduction in the size of the

    industry: the number of employees fell from some 90,000 in 1970 to a little over 30,000 in

    1984. Federation of the Swiss Watch Industry FH

    The paradigm shift that evisceratedthe Swiss Watch Making industry was the quartz

    crystal, invented by the Swiss, not protected, and used by competitors to make their

    highly skilled craft obsolete.

    Transaction of the Future

    Marketing Homes

    Party A wants to sell and advertises her home on Craigslist

    Party B wants to buy Party As home, Party A does not want Party Bs home, so the two

    Parties now work through their channels to sell Party Bs home.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 25

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    Party C is found and wants to purchase Party Bs home, but needs to sell his home first.

    Parties A, B and C all now work their channels to find a buyer for Party Cs home.

    Party D is found, wants to purchase Party Cs home, and Party A (remember Party A?)

    wants to purchase Party Ds home.

    Consumers Bundle the Entire Deal

    Contracts are created (maybe with the help of an attorney, or artificial intelligence


    Parties offer through a bidding process on e-Bay the entire package to one broker. Lowest

    bidder with most experience wins the bid.

    Consumers save tens of thousands of dollars.


    There is a lot of information contained in this paper, and yet, it is but an annotated outline

    of what must be done to take advantage of and build upon the strengths of MLS and of

    the real estate brokerage business.

    MLS is really an amazing creation if you think about itA collection of competitors, in a

    highly competitive, commission-only business, sharing inventory and sharingcompensation. The result is a more effective market for brokers and consumers. Over the

    years, MLS has changed and it continues to have the most accurate property data

    available anywhere, and it is constantly updated and kept accurate by an army of real

    estate practitioners. Today, agents and homeowners themselves are advertising their

    properties on Craigslist, Google, Yahoo, and other sites. All of these sites would love the

    content MLSs have because it is of much higher quality and accuracy, and would bring

    more traffic to their sites.

    Page 26

    What if the self-policing aspects (Web 2.0) really began working on Craigslist (or any

    other online advertising site)? What if every seller just knew that the place to advertise

    their home to consumers and to agents was on Craigslist? What if they know how to post

    it on Craigslist themselves (and you, the real estate professional did not know how)? If

    Copyright 2008. Saul D. Klein. All Rights Reserved.

  • 8/14/2019 MLS-Vision MLS 5.0 Saul Klein


    Craigslist became the source of all available properties for sale, nationwide, how might

    that impact the MLS? If as a REALTOR you could find the complete inventory of

    property for sale, for free, why would you pay $40 per month (or a lot more is you

    participate in multiple MLSs) to belong to MLS?

    If you think Craigslist would take the time to become known as the place to list property,

    you may be correct, but how many people knew of Google 5 years ago and how many

    know of it today? How many people knew of Craigslist 5 years ago and how many know

    of it today? In a short span of time, unknown web sites have become household words.

    The world of MLS as we know it is approaching a cliff, and many riding the MLS train,

    do not see the cliff as it gets closer with each passing day.

    And think about this, the inventory of books on Amazon, or the inventory of things forsale on e-BAY, or the things for sale on Craigslist are available to the world through one

    database. Does that teach us anything about where MLS might head in the future?

    So here is the point, we dont expect things to remain as they have always been, so how is

    MLS any different? MLS needs to redefine itself from a purely Business to Business

    (B2B) network tool to a marketing facilitator for its participants and subscribers. It needs

    to take advantage of its assets and shift its paradigm from information about what is for

    sale to information on all property whether for sale or not. From this perspective, brokers

    and agents can continue to effectively differentiate themselves from the competition,

    manage information more efficiently, provide more service to their customers, and evolve

    to be the trusted and authoritative source they would like the world to think they are.

    Is the creation ofMLS 5.0 a major project? It is. It will require conversation and analysis

    by all who are considered as stakeholdersbut how do you eat an elephant? You have

    heard it for years: one bite (byte) at a time.

    Copyright 2008. Saul D. Klein. All Rights Reserved. Page 27

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    Your Plan of Action:

    Circulate this document

    Create a Committee for the Future of MLS

    Participate in online discussions (start at

    Start local online discussions with MLS and association leadership

    Analyze your current MLS structure

    Adopt the Vision and Mission of MLS 5.0

    Analyze the Strengths, Weaknesses, Threats, and Opportunities of your MLS

    Create a Strategic Plan

    Create a 12-18 month Operating Plan for implementation of your MLS Strategies

    Include timelines and a Critical Path Analysis Constantly track communicate progress to Stakeholders

    Keep an open mind